Tags: barron’s | utility | stocks | steady | chaos

Barron's: Utility Stocks Can Be Steady Performers Amid Market Chaos

100 dollar bill wrapped onto a lightbulb
Mquirk | Dreamstime.com

By    |   Friday, 04 January 2019 01:48 PM

Savvy investors looking for a bright idea on where to stash their cash during the seemingly endless stock-market volatility should look no further than when they flip the light switch.

Barron’s recently explained that "utility stocks lived up to their reputation as a solid defensive play in 2018, and they have the potential to keep outperforming, especially if more volatility ensues” in the new years.

Utilities are often coveted for their durable earnings and attractive yields. For example, Barron’s cited the Utilities Select Sector SPDR Fund (XLU), which has a three-year annual return of 9.93%, compared with 9.28% for the broader index. It has also outperformed over five- and 15-year stretches.

Phil Sundell, a portfolio manager at American Century Investments, says investors like utilities these days because “there’s certainty involved.”

He favors electric and natural gas utilities in regulated businesses. For the electric utilities, that includes power generation, transmission, and distribution. Sundell maintains that on average, these companies can grow their earnings at annual clip of 5 to 7% for the next three to five years, up from 4% historically, Barron's reported.

To be sure, the most successful investors aren't "afraid of the big, bad bear market," Newsmax Finance Insider Andrew Packer explains.

"Thanks to two big rallies in 2018, being a nimble investor throughout the year ended up making the year pretty profitable. At least that’s how it unfolded for myself and my subscribers," Packer explained.

"For instance, in the Financial Braintrust, we closed 19 trades in 2018. 17 were winners. One was a loss. One involved being put shares, so if this were baseball that one would have an asterisk next to it. That’s still an 89 percent win rate," he said.

"So what’s the secret to my success? There’s no secret. It really and truly does come down to a few basic principles," he said.

"Those principles balance the science of investing (the stodgy financial statement-reading part that puts many to sleep) with the art of investing (the part that often gets people overly invested emotionally where they make big, dumb mistakes)."

© 2019 Newsmax Finance. All rights reserved.

   
1Like our page
2Share
StreetTalk
Savvy investors looking for a bright idea on where to stash their cash during the seemingly endless stock-market volatility should look no further than when they flip the light switch.
barron’s, utility, stocks, steady, chaos
345
2019-48-04
Friday, 04 January 2019 01:48 PM
Newsmax Media, Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved